Money laundering and bank risk: Evidence from U.S. banks

Yener Altunbas, John Thornton and Yurtsev Uymaz

International Journal of Finance & Economics, 2021, vol. 26, issue 4, 4879-4894

Abstract: We test for a link between bank risk and enforcements issued by U.S. regulators against banks for money laundering (ML) in a sample of 960 publicly listed U.S. banks over 2004–2015. ML‐related enforcements are associated with increased bank risk on several measures of risk with the result robust to a variety of estimation methodologies. Moreover, the impact of ML on bank risk is accentuated by the presence of powerful CEOs and only partly mitigated by large and independent executive boards.

Date: 2021
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https://doi.org/10.1002/ijfe.2044

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Working Paper: Money laundering and bank risk: evidence from US banks (2019)
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